Chevron, San Juan settle water contamination dispute

Chevron has finalized a deal with San Juan Capistrano to pay for clean-up of contaminated groundwater in the city, Mayor Sam Allevato announced Tuesday night.

The settlement, which has long been in the works, follows city expenditure of about $5.2 million after a gasoline additive – methyl tertiary butyl ether, or MtBE – was found in the city's groundwater in January 2008. In 2009, the city shut down two groundwater wells in relation to the MtBE leak.

Allevato said the financial terms of the settlement would remain confidential and that the city and Chevron plan to work together on an enhanced filtration system at the city's groundwater recovery plant.

Chevron, which acknowledged responsibility for the leak that originated at two of the company's gas stations many years ago, is to clean up the affected area. The clean-up is to be monitored by the San Diego Regional Water Quality Control Board.

Chevron called the agreement a "way for us to fulfill our commitment to the people of San Juan Capistrano, which we have been eager to do for a long time," Juan Garcia, a Chevron representative, said in a statement read by Allevato.

Chevron and the city have been battling for years over how to deal with the MtBE issue.

At one point the city was considering increasing water rates 5 to 9 percent to cover MtBE expenses, but in September, city leaders voted against the increase. Chevron had called the proposed charge "inappropriate and unnecessary." San Juan ratepayers in February 2010 saw an average 22 percent increase in their water bills resulting from a regular review of water costs and services.